Ministers have requested the British Council to attract up spending plans that might power it to shut in as many as 60 international locations, sources have instructed the Guardian, within the newest signal of the influence of Keir Starmer’s choice to chop the help price range.
The council has been requested to attract up two units of spending plans as a part of Wednesday’s spending evaluate: one through which its funding would stay the identical in money phrases and one through which it could be reduce by 2% in money phrases annually.
The eventualities are the identical as these which were demanded of the BBC World Service, and would imply the council having to close utterly in massive components of the world. The plans are probably so as to add to warnings that the federal government’s cuts to abroad support are at risk of damaging its soft power simply as Russia and China are placing extra assets into strengthening theirs.
Scott McDonald, the council’s chief govt, wouldn’t touch upon the Treasury’s calls for however stated: “The British Council performs a significant position in delivering UK smooth energy across the globe. Funding in smooth energy is crucial to any nation that needs to be instrumental on the world stage. Over the past three years we’ve got taken £180m of prices out of the organisation by a considerable transformation plan, however the quantity of funding we obtain from the UK authorities will have an effect on nation closures.”
McDonald has previously warned that monetary pressures on the council might make it “disappear” inside a decade.
The council receives £1bn in income annually, however 85% of that comes from promoting its English-language providers all over the world. In 2024-25 it acquired £163m in a authorities grant, most of which got here from the worldwide support price range.
Earlier this yr, the prime minister announced he would cut back the help price range from 0.5% of gross home product to 0.3%, liberating up about £6bn in additional spending for defence.
The reductions to the help price range are actually being felt in Whitehall, with the chancellor, Rachel Reeves, having imposed what insiders say are swingeing cuts on the International Workplace. In consequence, establishments such because the British Council and BBC World Service are being requested to mannequin main spending reductions.
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These near the negotiations with the federal government say the council had requested for an extra £20m a yr in funding, not least to assist repay a £197m mortgage to maintain it working in the course of the pandemic.
That mortgage, which was made on industrial phrases, has now been rolled over for an additional 18 months, however insiders say the repayments are costing it £14m a yr.
If it receives no additional money within the subsequent few years, these near the talks say, it must shut in 40 international locations. Cuts of two% in money phrases would require 60 closures. Each of those could be on high of the 20 workplace closures that it announced in 2021, when it was instructed to cut back its price range by £185m over 5 years.
The council’s monetary disaster is inflicting alarm amongst politicians and navy chiefs, who say its actions increase Britain’s nationwide safety.
Dozens of high-profile figures recently wrote to the prime minister urging him to not reduce the council’s funding. They included the previous dwelling secretary James Cleverly, the previous defence secretaries Grant Shapps, Ben Wallace and Michael Fallon, the previous international secretary David Miliband and the previous navy chiefs Richard Dannatt and David Richards.
The letter warned: “As we compete more durable for world affect, the necessity for the British Council’s distinctive contribution to our safety is bigger than ever. We name upon you to take a position on this nice nationwide asset and force-multiplier, earlier than it’s too late.”
Peter Ricketts, the previous nationwide safety adviser, who organised the letter, instructed the Guardian: “Lots of defence folks will inform you {that a} small funding in smooth energy such because the British Council is value some huge cash on the navy aspect.”
A International Workplace spokesperson stated: “Regardless of the robust fiscal state of affairs, we proceed to again the British Council with over £160m in 2025-26.”
The spokesperson added that no choices had but been taken over its funding for the following few years.
